David Chao: A busi­ness­man with a pas­sion to help BIO

China Daily (Canada) - - ACROSSAMER­ICA - By QI­DONG ZHANG in San Fran­cisco kel­lyzhang@chi­nadai­lyusa.com

The year was 1995, and the time was 5:46 am.

Just as com­muters in Ja­pan were start­ing their jour­ney into work, an earth­quake struck Kobe. In the 20 sec­onds or so that the tem­blor shook the city of 10 mil­lion on Tues­day, Jan 17, more than 5,000 peo­ple were killed and 36,000 in­jured.

The quake also de­stroyed the home of David Chao’s par­ents in the city in south-cen­tral Ja­pan where he was born to a mother from Shang­hai and a fa­ther from North­east China.

“Many of our fam­ily friends were killed and I went back to Ja­pan to help my par­ents com­ing out of a shel­ter. The usual one-hour bus ride from the air­port to my home took 20 hours, and the sit­u­a­tion was dev­as­tat­ing,’’ re­called Chao. “At that mo­ment I re­al­ized life was so frag­ile, we could die any mo­ment and a per­son should re­ally do what he wants to do and fol­low his heart. So I quit my job and im­me­di­ately started my own busi­ness.’’

To­day, his busi­ness — DCM, a ven­ture cap­i­tal in­vest­ment firm based in Menlo Park, Cal­i­for­nia — man­ages more than $2.5 bil­lion and since 1999 has in­vested in over 200 com­pa­nies across China, Ja­pan and the US.

The com­pany’s most known IPOs are Fortinet, Clear­wire, Kabu.com, 51job, 58.com, Ren­ren, Dang­dang, and Vip­shop, the last of which went pub­lic in 2012 with a mar­ket cap then of $600 mil­lion and now more than $7.1 bil­lion.

Chao at­tributes his suc­cess to his cross-cul­ture back­ground, hav­ing part­ners very in­volved in China, close ties with lo­cal part­ners, and good chem­istry be­tween team mem­bers at DCM, where he is co­founder and gen­eral part­ner.

Be­yond fo­cus­ing on his busi­ness, Chao’s pas­sion has been pub­lic ser­vice, specif­i­cally help­ing Chi­nese pro­fes­sion­als in Sil­i­con Val­ley as well as China, and Chi­nese stu­dents who study in the United States.

Chao was elected as pres­i­dent of Hua Yuan Sci­ence and Tech­nol­ogy As­so­ci­a­tion (HYSTA) in 2014, one of the largest en­gi­neer­ing as­so­ci­a­tions in North Amer­ica with more than 7,500 mem­bers.

Its mis­sion is ex­plained on its web­site:

“HYSTA aims to pro­mote en­trepreneur­ship and ca­reer de­vel­op­ment among Chi­nese pro­fes­sion­als in Sil­i­con Val­ley, and to fa­cil­i­tate net­work­ing and ex­change of busi­ness ideas among suc­cess­ful Chi­nese en­trepreneurs and ex­ec­u­tives in Sil­i­con Val­ley and Chi­nese main­land.

To Chao, an or­ga­ni­za­tion like HYSTA gives young pro­fes­sion­als the op­por­tu­nity to get ad­vice from in­dus­try lead­ers, and helps them de­cide on a ca­reer choice.

“Some en­gi­neers may de­cide the cor­po­rate lad­der is not what they want to climb and choose to be en­trepreneurs in­stead,’’ he said. “They won’t know un­til they talk to those who are ex­pe­ri­enced and HYSTA is an im­por­tant and re­source­ful or­ga­ni­za­tion in Sil­i­con Val­ley to rely on.”

“Young peo­ple also need role model or guid­ance when it comes to ca­reer, and HYSTA is the per­fect plat­form for them,” added Chao.

HYSTA’s an­nual con­fer­ence is con­sid­ered a high­light by Sil­i­con Val­ley’s busi­ness com­mu­nity. Last year’s guest speak­ers were Jerry Yang, co-founder and for­mer CEO of Ya­hoo! Inc, and Jack Ma, the main founder of Alibaba Group, China’s largest e-com­merce busi­ness.

Chao said HYSTA’s func­tions have mul­ti­plied since its found­ing 10 years ago.

“It used to be only HYSTA and Asian Amer­i­can Mul­titech­nol­ogy As­so­ci­a­tion (AAMA) were avail­able for Chi­nese and Chi­nese Amer­i­can en­gi­neers in Sil­i­con Val­ley, but now there are so many other or­ga­ni­za­tions in town. How HYSTA serves as a mother ship and sets ex­am­ple for all oth­ers is some­thing to which I would like to de­vote my ef­fort and time as pres­i­dent of HYSTA this year.’’ he said.

Flu­ent in Ja­panese, Chi­nese and English, Chao came to the US at age 13 and stud­ied at Thacher High School, a board­ing school in South­ern Cal­i­for­nia.

“It was a fan­tas­tic ex­pe­ri­ence. Asian chil­dren usu­ally have ma­jor cul­ture shock when they land in US mid­dle school or high school from China, but board­ing schools like Thatcher is staffed with nur­tur­ing teach­ers, an un­der­stand­ing com­mu­nity sup­port­ing in­ter­na­tional stu­dents, and be­ing not su­per com­pet­i­tive. I had such a won­der­ful ex­pe­ri­ence there that I want to do some­thing to give it back to the school and the com­mu­nity,” said Chao.

With two of his sons David Jr, 17, and Lukas,14, now at Thacher, Chao also plays an ac­tive role in the school’s China pro­gram, in­clud­ing in­ter­view­ing and re­cruit­ing stu­dents from China, and host­ing re­cep­tions for them.

“I like to in­vest in young peo­ple,’’ he said. “To­day many Chi­nese stu­dents come to the US to start mid­dle school and high school. A solid China pro­gram at an Amer­i­can mid­dle school ben­e­fits stu­dents, par­ents and teach­ers, and I want to be part of it.”

Grow­ing up in Ja­pan in a Chi­nese fam­ily, Chao said there was al­most no op­por­tu­nity for his par­ents to work for large Ja­panese com­pa­nies in those days, which he said planted the en­trepreneur­ship spirit in him at a young age.

How­ever, he fol­lowed the tra­di­tional path of a typ­i­cal Chi­nese fam­ily in which par­ents tell their chil­dren to be­come a doc­tor as a first ca­reer choice. He went to Brown Uni­ver­sity’s med­i­cal school, but re­al­ized af­ter a year that was not what he wanted. Grad­u­at­ing with an econ­omy and an­thro­pol­ogy de­gree in 1987, he re­ceived three of­fers from Wall Street. But they were with­drawn be­cause the stock mar­ket crashed on Oct 19, 1987, known as “the Black Mon­day”.

With­out a green card as a for­eigner, Chao had to re­turn to Ja­pan where he worked for Re­cruit, an ad­ver­tis­ing com­pany, and then took a po­si­tion at Ap­ple Inc in Ja­pan.

With his Ja­panese-Amer­i­can wife Amanda Mi­nami, Chao moved back to the US in 1990, and worked at Ap­ple’s head­quar­ters in Cu­per­tino, Cal­i­for­nia.

He then went to busi­ness school at Stan­ford Uni­ver­sity, but when he grad­u­ated in 1993 he en­coun­tered an­other bad job mar­ket. He


Age: 47 Born: Os­aka, Ja­pan • MBA, Stan­ford Uni­ver­sity (1993) • BA, eco­nomics and East Asian Stud­ies (an­thro­pol­ogy), Brown Uni­ver­sity (1988) • Co-founder and gen­eral part­ner, DCM (1997) • Co-founder, CFO/CTO of Ja­pan Com­mu­ni­ca­tions Inc (1995) • McKin­sey & Com­pany (1993) • Ap­ple Inc (1989)

• Re­cruit Corp (1988) • Chair­man, 51job • Board mem­ber: Ren­ren. • Ad­vi­sory Board, Leg­end Cap­i­tal, China • Trustee, the Thacher School, Ojai, Cal­i­for­nia • Listed as one of the top ven­ture cap­i­tal­ist in Asia and the US by Forbes Mag­a­zine since 2004 even­tu­ally be­came a man­age­ment con­sul­tant at McKin­sey & Co in San Fran­cisco and worked there for three years, but the de­sire to start his own busi­ness never left him. He co­founded DCM in 1997 af­ter rais­ing an ini­tial $50 mil­lion.

With a dy­namic cross-cul­ture back­ground and a be­lief in glob­al­iza­tion in busi­ness and hu­man­ity, Chao also spends his time as an ac­tive vol­un­teer at the Stan­ford Pro­gram on In­ter­na­tional and CrossCul­tural Ed­u­ca­tion (SPICE). The pro­gram sup­ports in­ter­na­tional el­e­men­tary and sec­ondary school cur­ric­ula by link­ing the re­search and teach­ing at Stan­ford Uni­ver­sity to schools through the pro­duc­tion of high-qual­ity cur­ricu­lum ma­te­ri­als on in­ter­na­tional themes.

“We live in such a com­plex global world to­day and if you pay close at­ten­tion to daily news, it’s a world in con­flict ev­ery­where, ei­ther China ver­sus the US, Ja­pan ver­sus China, or the US ver­sus the Mid­dle East,’’ he said. “My per­spec­tive is the world re­ally can­not af­ford con­flict and we all need to learn, to share and col­lab­o­rate with each other. The best way is through ed­u­ca­tion at a young age so that mu­tual un­der­stand­ing of dif­fer­ent cul­tures, his­tory and eth­ni­cal back­ground is taught across the bor­der.”

Es­tab­lish in 1976 and housed in the Free­man Spogli In­sti­tute for In­ter­na­tional Stud­ies at Stan­ford, SPICE has pro­duced more than 100 sup­ple­men­tary cur­ricu­lum units on Africa, Asia and the Pa­cific, Europe, Latin Amer­ica, the global en­vi­ron­ment and in­ter­na­tional po­lit­i­cal econ­omy.

“A good ex­am­ple is the Viet­namese pop­u­la­tion in the US, which is one of the fastest grow­ing pop­u­la­tions. Their num­ber one is­sue is that when they learn about Viet­nam, the only thing men­tioned in the text­book is the Viet­nam War, there is no men­tion of its cul­ture and his­tory. What SPICE does is to pro­vide text­book ma­te­ri­als for our school teach­ers to teach Viet­namese his­tory and cul­ture so that they have a good ref­er­ence choice on ed­u­ca­tion. The same case ap­plies to Chi­nese, In­dian, Ja­panese and ev­ery other eth­ni­cal group in the world, which I thought is a phe­nom­e­nal ef­fort to make a dif­fer­ence to our kids’ ed­u­ca­tion,” said Chao.

SPICE gives stu­dents the op­por­tu­nity “to learn across borders’’, he said.

“One cur­ricu­lum SPICE of­fers is re­search on what each coun­try writes in their text­books. Ja­panese text­books tend to in­ter­pret World War II in one way, US and China in an­other way. SPICE helps to cre­ate a cur­ricu­lum that gives stu­dents the op­por­tu­nity to learn what is go­ing on and make their own judg­ment on what is right, what is wrong, and if it should be changed. And teach­ers re­ally ben­e­fit from it since they now know how to teach from an across bor­der com­par­i­son.”

Chao said that in a thou­sand years, maybe there will be a world with­out borders, where peo­ple min­gle with each other across cul­ture and his­tory and live in a peace­ful world.

“To­day we have a lot of mix-cul­ture phe­nom­e­non in the US. Our se­cond gen­er­a­tion may feel part Amer­i­can, part Ja­panese, part Chi­nese, or a part of an­other eth­i­cal race. My re­spon­si­bil­ity is to con­trib­ute to part of their early ed­u­ca­tion so that our younger gen­er­a­tion will have knowl­edge of mul­ti­ple cul­tures, learn­ing mul­ti­ple his­to­ries, and ba­si­cally learn­ing from each other. That’s part of the le­gacy I want to leave to the world other than my pas­sion for tech­nol­ogy and my fam­ily.”

Scan it!


Ven­ture cap­i­tal­ist David Chao at­tributes his suc­cess to his cross-cul­tural back­ground as well as good chem­istry be­tween the team he leads at his firm DCM in Menlo Park, CA.

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